The Lowest-Cost-of-Living States and Why They Offer Good Opportunities

Did you know that people who live in the lowest-cost-of-living states often find it a little easier to achieve some of their biggest goals in life? Those goals may include going to school, securing a good job, owning a home, and contributing to savings and retirement accounts. By finding and moving to the lowest-cost-of-living state that resonates with your goals, you can make your dollars stretch a little further and afford a more comfortable lifestyle than if you choose one of the most expensive states to live in.

A lot of people think that the best opportunities are found in the most expensive states and cities. After all, that's why so many people choose to live there, right? Aren't you going to find the best jobs in places like New York City (which was ranked the seventh most expensive city in the world in 2016)?1 Well, not necessarily. The reality is that great opportunities can be found across the country, including in some of the cheapest places to live.

For example, what if you found out that you could pursue your dream career in a place like Jackson, Mississippi or Indianapolis, Indiana? You could attend a great post-secondary school, land the job you have always wanted, and start building the life that you desire. And you could have the potential to do all of it more quickly and easily than if you chose to live in a more expensive location. That sounds pretty good, doesn't it?

If you're ready to learn more about your options, then take a look at the following categories to see where the least and most expensive states and cities are ranked:

How Is Cost of Living Determined?

Cost of living is a measure that ranks a location based on factors like the cost of rent, groceries, transportation, utilities, restaurants, and other common living expenses. It also factors in purchasing power, which is an equation that determines the number of goods and services that can be purchased with the average wage in that location.

Historically, New York City has been the most expensive city in the country, and it sets the benchmark that all other cities are compared to. NYC is given a cost of living value of 100, and every other city's value is determined based on calculations related to the cost of living factors discussed above. However, occasionally, a city will have a higher value than New York, which, according to 2016 data, is currently the case. San Francisco's cost of living is now 3.4 percent higher than NYC's.2

Determining the cost of living among different states works the same way as it does for cities, but the states are compared to the national average, which is also valued at 100. As of 2016, Mississippi comes out on top as the lowest-cost-of-living state.3 Continue reading in order to discover which states made the top 10. The results may surprise you.

Top 10 Lowest-Cost-of-Living States

When deciding where to go to school or find a job, affordability is frequently an important consideration. Some of the best affordable places in America offer the opportunity to secure a good job, make a decent living, buy a nice home for less than $200,000, and still be able to enjoy a comfortable lifestyle. Many cheap places to live in the U.S.A offer opportunities to save money through lower housing, grocery, utility, food, entertainment, and transportation costs.

By choosing to live in one of the states with the lowest cost of living, you could end up with more money in your pocket. Take a look at the list below and see if you can picture yourself living in one of those locations. To help you consider your options, we have included basic information like the strongest industries, fastest-growing jobs, average rent, and median home prices for each state. The list starts with the lowest-cost-of-living state in the country, based on information collected from the second quarter of 2016.3 (The average monthly rent is based on data from October 2016.4 And the median home prices reflect data collected from August 2016.5)

As a state, Mississippi offers the lowest cost of living in the U.S. But, along with a low cost of living, there are many other great reasons to call Mississippi home. You can live a rural lifestyle while still having access to all of the city amenities you want. The state is easy to get around in, traffic congestion is minimal, and it has abundant forests, parks, and wildlife reserves for outdoor enthusiasts.

There also might not be a friendlier place to live. In fact, Mississippi is known as the Hospitality State. It is a great place to get to know your neighbors and belong to a strong community. And it could also be a good place to find a job. There are a wide variety of strong and growing industries to choose from.

Indiana comes in second for the state with the lowest cost of living. But there are more reasons to live there than just that. The state offers all kinds of opportunities to experience arts, culture, dining, sporting events, and fairs. With a number of interstate highways, you can travel around easily, and you can even get away to fun places like Chicago or Nashville for a mini-vacation.

There are also great schools and training programs for those who want to expand their knowledge and skills. You can set yourself up to pursue professional opportunities in many different sectors across the state.

Cost of living—12.8 percent lower than the national index

Strongest industries—Education, finance and insurance, healthcare and social assistance, government services, manufacturing, and real estate8

Average monthly rent—$843

Median home price—$116,700

Here are some of the top jobs in Indiana, along with their projected growth rates for the decade from 2014 to 2024.9

If you are looking for the states that offer the cheapest cost of living, then Idaho may be a good place for you. In fact, in 2016, Conde Naste Traveler named Boise as the sixth best place to live in the U.S.10 A lot of that has to do with the fact that you can achieve a laid-back lifestyle that balances urban amenities with natural beauty. And you can find that quality of life across the state.

Many people love the outdoor lifestyle in Idaho because the state is brimming with unspoiled mountains, lakes, rivers, and even natural hot springs. The craft brewing and culinary scenes are thriving, and there is even a small wine region. And this is the place where you can become familiar with the elusive huckleberry. It is also a place where you can find a great job in one of the state's strong, diverse industries.

Oklahoma is known as the Sooner State. Maybe that's because the sooner you move there, the better (so that you can start benefiting from one of the cheap places to live in the U.S.A.) With friendly people, delicious food, beautiful lakes, and thriving arts, culture, and music scenes, it's easy to see why this could be a great place for you to live. Even National Geographic Traveler ranked Oklahoma City among the top 20 best cities to visit.13

Oklahoma is a great place to work as well. The state typically boasts a lower-than-average unemployment rate, and it had the sixth highest personal income growth in the country from 2010 to 2015. During that time, personal incomes grew by almost 19 percent.14 You can choose from a variety of interesting industries and jobs, as well as colleges and universities that can help you gain any additional skills that you may need.

Affordable, beautiful, friendly, and convenient are just a few of the ways that Arkansans describe their state. You can take advantage of a laid-back lifestyle and enjoy little to no traffic congestion, even when you are in the city. Outdoor adventurers love the almost endless possibilities for recreational activities, and it's easy to have a weekend getaway to the Gulf Coast, Dallas, Memphis, or Nashville.

You can also find rewarding and meaningful career opportunities across the state. In fact, Arkansas workers experienced the 12th highest personal income growth in the nation from 2010 to 2015. During that time, personal incomes grew by almost 16 percent.14 So take a moment to consider what Arkansas can offer you.

Cost of living—11.9 percent lower than the national average

Strongest industries—Aerospace, agriculture, business and professional services, information technology, manufacturing, retail, and transportation17

Average monthly rent—$779

Median home price—$114,600

Explore some of the fastest-growing occupations in Arkansas. Their anticipated growth rates are also included for the period from 2014 to 2024.18

Kansas is where you will find homegrown hospitality, state pride, and rolling prairies filled with incredible sunflower and wheat fields. Along with ranking as a lowest-cost-of-living state, Kansas boasts low unemployment and personal income tax rates. You can also find a number of great training options that can prepare you to join one of the state's strong career sectors.

Whether you are into BBQ, music, arts, culture, history, outdoor recreation, or sports, you can find some of the best in Tennessee. It is no wonder that the state and its cities are regularly ranked as the best places to live in the nation. Tennessee offers something for everyone, and that even holds true for the job market.

From 2014 to 2024, jobs could grow in number by more than 13 percent. That amounts to approximately 400,000 new job openings.21 And if you need to obtain post-secondary training to prepare for one of those career fields, then you need not worry. The state has no shortage of training opportunities either.

In Missouri, you can choose from city living or rural living with city amenities nearby. Missourians take their BBQ and professional sports teams seriously, but there are many other well-loved state foods and activities to partake in. There are almost countless lakes and beaches to choose from, and you will find a wide selection of classic and craft breweries and wineries.

The state's job market is also stable and growing. It is estimated that, from 2014 to 2024, there will be more than 175,000 jobs added to economy, which represents more than six-percent growth.3 And if you need to brush up your skills, then you can choose from a number of trade schools, colleges, and universities that can help you prepare for an exciting career.

Texas can easily be seen as a state of opportunity. Along with ranking as one of the states with the lowest cost of living in the U.S., Texas has a strong economy and ample opportunities for professionals of all types. In fact, as of 2016, Texas has the third-fastest-growing economy in the country.14 In August 2016 alone, 21,400 new jobs were added to the state's economy.24 Additionally, the state has the second-highest personal income growth in the nation. It grew by more than 23 percent from 2010 to 2015.14 And Forbes named Austin the fastest-growing city in America and Dallas the third-fastest-growing city, coming in with 3.15-percent and 2.16-percent growth in 2015, respectively.25

You can surely find a community in Texas that suits your needs. Six of the country's 20 largest cities are located in Texas, but there are also many quaint small towns throughout the state if those are more your style. Additionally, many people do not realize that Texans embrace diversity. For example, Austin has been said to have the world's best BBQ, yet it has also been cited as the best place in the country to be vegan. Considering all of that, along with the fact that the state has a low unemployment rate and no state personal income tax, you can likely see why Texas is seen as an attractive option for many people.

Cost of living—10.1 percent lower than the national index

Strongest industries—Energy, information and computer technology, international trade, manufacturing, research and development, tourism, and transportation26

Average monthly rent—$1,247

Median home price—$159,000

Below are some of the fastest-growing jobs in Texas, along with their anticipated growth rates during the decade from 2014 to 2024.25

Although it's called the Bluegrass State, Kentucky is known for live music that spans many different genres. ("Bluegrass" actually refers to the grass that grows abundantly across the state.) And don't forget about the bourbon, sports, and friendly, helpful people. Towns and cities across Kentucky have thriving culinary and coffee scenes, and there is no shortage of farmers' markets and festivals.

You'll find lots to see and do since the state is filled with diverse, beautiful landscapes. And you're not too far from cities like Nashville, Cincinnati, and Indianapolis. From a professional standpoint, there are a variety of strong industries offering career opportunities. Additionally, there are a number of great post-secondary schools to choose from in the event that you need to gain new skills and abilities. So, coming in 10th for the state with the lowest cost of living, Kentucky may be the affordable place that you are looking for.

Top 10 Cities With the Lowest Cost of Living

According to data from the second quarter of 2016, Reno, Nevada tops the list as the city with the lowest cost of living.2 But there are lots of other great options across the country, from Georgia to Idaho. Why not explore the lowest-cost-of-living cities where you can live, learn, and work—all while stretching your dollars as far as possible? You may find that goals like owning a home and growing your savings or investments become more achievable when you live in one of the lowest cost cities.

So take a look at the following list and see if any of the locations appeal to you. With each city, you can see how much lower the cost of living is compared to New York City. The information is based on data collected in 2016.2

Top 10 Most Expensive States to Live in Within the U.S.

Some of the most expensive states to live in probably come as no surprise. For example, Hawaii tops the list due to the islands' high costs for items ranging from fuel and electricity to real estate and food. And because many people want to know where to find the lowest cost of living in California, it probably isn't a shock to learn that the state comes in at number three on the list.

Below, you'll discover the 10 states and regions with the highest cost of living. You'll also see how much higher the cost of living is than the national average. The information is based on data collected from the second quarter of 2016.3 But keep in mind that, when you are looking at cost of living and determining where to live or go to school, it is important to look at other factors as well. Those include things like job availability and average wages. If you can land a high-paying job in a state or region that has a higher cost of living, then the move still might be worth it.

In fact, the highest-cost-of-living states and regions all pay median wages that are higher than the national median, which was $17.81 per hour in 2016. The District of Columbia tops the list with a median wage that is 83 percent higher than what is found nationally. So a high-paying job, combined with conservative spending, could mean that a high-cost-of-living state would still be affordable for you. Review the cost of living for the first quarter of 2018 among the states below and check out how much higher their median wages are than the national median, as of 2017.29

Where Will Your Future Take You?

As you explore your opportunities within the lowest-cost-of-living states, you may realize that you can benefit from additional training from a trade school, college, or university. Take your first step today and find out what programs are being offered near you by entering your zip code into the search box below. Don't hold back from achieving your true potential!